Queensland RFA: Gas Prices Intact With #Ethanol

The Queensland Renewable Fuels Association (Queensland RFA) has come out in support of ethanol after various statements from organizations claim that blending ethanol in the fuel supply will increase the price of gas. This, says Queensland RFA, is not true. The debate was heightened recently when the State of Government’s ethanol mandate passed along with a report from the Australian Competition and Consumer Commission report that was published that found that a similar mandate in force since 2007 in NSW has reduced consumer choice at the pump and thus forced drivers to buy more expensive octane blends.

Beginning January 1, 2017, large retail stations will be required to offer at minimum 3 percent of their total regular and ethanol-blended gas sales each quarter be biobased. This can include blends such as E10. The mandate will increase to 4 percent in 2018. In addition, the mandate requires 0.5 percent of all diesel fuel be sold contain a biobased fuel such as biodiesel.

Larissa Rose, Managing Director for Queensland RFA, said the comparison of the Queensland and NSW mandates were misleading. “When NSW introduced its mandate in 2007, consumers were unsure about filling up with E10, which caused them to purchase premium grade fuels, therefore raising fuel sales in those categories,” said Rose. “Because there was minimal consumer education about the environmental benefits of E10 and its capacity to give consumers a safe higher-octane fuel at a lower price for their vehicles, misperceptions in the marketplace occurred, leading to a significant increase in consumers choosing the premium fuels, and therefore paying more.”

When the mandate goes into affect, 91 unleaded gas will still be available, said Rose, for drivers who don’t want to change their fuel consumption habits or expenditures.

“What we need to do is ensure there is consumer education to remove the stigmas about biofuels and help consumers make an informed and aware choice at the purchase point. But for consumers who choose to continue using the same fuel they have always used, there will be no significant price impact as a result of this mandate,” said Rose. She added, “Biofuels reduce carcinogenic tailpipe emissions as concluded by the CSIRO/Orbital Research Report (2008), that using E10 decreases the lung embedding particle PM2.5 by 33%. Further focus is supporting Queensland agriculture by investing in our grain and sugar producing regions to produce ethanol domestically. That can only be a significant benefit to this State.”